Wise investments

BM meets Arslan Hussain, Chief Information Officer for SABB (The Saudi British Bank) to talk budgets in an economic downturn, new business channels and how the role of an IT head has evolved.

“The goal is to standardise process and technology to enable business with SABB to be simple, intuitive, driven by the customer and 24/7 self-service, leading to enhanced customer experience”
-Arslan Hussain

Talk to most CIOs today and they will tell you that the role of an IT chief is light years removed from the early days when they were labelled as nerdy ‘techies’ tinkering away in the bowels of an organisation. Nowadays, heads of IT have taken their seats in the C-suite as the job has morphed into a key strategic position that’s in tune with your business’ operations and its customers. This is especially so at a tech-heavy industry like banking. “Gone are the days when we would talk purely technology and we would be order takers, as I call it,” SABB’s CIO Arslan Hussain explains. “We are now definitely more in partnership with the business and we have to understand it. We have to put ourselves in the shoes of the business and look at it from different perspectives.”

Of course, the financial services industry is a unique sector, being so heavily dependent upon technology and systems for in-house operations and the all-important customers. Arslan says the banking industry is becoming evermore service-orientated as apposed to “just delivering systems and applications because the business asks for it”. And the banks in this part of the world are hungry for new business and retaining existing customers so are rolling out new channels. The Middle East is a growth region for banking, as Arslan discovered 10 months ago when he swapped the Windy City (Chicago) for hot and vibrant city of Riyadh in the Kingdom of Saudi Arabia. Arslan had been Director of Business Systems for HSBC Technology and Services North America and decided to up sticks and move half way around the world to become CIO for SABB – forty percent owned by HSBC. SABB, which has a heritage stretching back 30 years, is the third largest bank in the Kingdom with 100 branches and 450 ATMs. Arslan is responsible for running SABB’s entire technology function, from customer and staff facing applications, the bank’s kingdom-wide telecommunication network, to the bank’s core systems.

Being part of HSBC means that SABB have evolved into a technology-driven bank with a wealth of IT power to leverage from. HSBC has around 20,000 developers working on systems that are built once and deployed many times across the group. “The applications are built by what we call the HSBC Software House, which is based globally in Canada, and they are deployed across different regions and countries,” Arslan explains. “The goal is to standardize process and technology to enable business with SABB to be simple, intuitive, driven by the customer and 24/7 self-service, leading to enhanced / better customer experience.”

Challenges
Since arriving in Saudi Arabia Arslan has become all too aware of a major challenge facing the IT sector: talent. The Gulf depends heavily on an influx of skilled expatriate workers but the Kingdom has Saudisation laws that have to be adhered to. This creates problems for a CIO like Arslan when looking to fill positions. “Saudisation is a good thing for the country,” he notes, “but in the near-term this creates challenges for IT, who are being asked to deliver the quality technology solutions within accelerated timeframe and reduced budgets.”

Another concern is the reliability of the telecommunication infrastructure in the region as providers try to keep pace with the evolution of new technologies. In the West, reliability is expected but for the Gulf there are still issues that need to be addressed. “We do experience occasional outages.” Arslan concedes. “We assume from a US or European perspective that our networks, telecoms and data lines run 24/7, 365 days a year. For the most part, that is the case. However, the Kingdom and other countries in the Middle East are fairly new establishments with new infrastructure; they are still in the growth phase.” Indeed, there are isolated areas where SABB is looking to build branches as part of an expansion push, creating more infrastructure challenges.

Aside from these challenges, there is the other issue for some CIOs in trying to convince management to invest new technologies. Indeed, the relationship between a CIO and CFO is sometimes portrayed as a strained one; the CFO keeping a tight grip on the purse strings as the CIO desperately tries to explain how a new all singing, all dancing technology will transform operations. The notion that CIOs are from Mars and CFOs from Venus springs to mind. Contrary to this belief, Arslan says that management at SABB are extremely receptive to new ideas and technologies to improve customer experience while fostering growth. “The support that I have seen from the management, including the SABB board, is phenomenal,” he reveals enthusiastically. “Once they understand what this piece of technology can do for the customer, their eyes light up and they are willing to invest in it. That’s where the CIOs or technology leaders come into play because it is about understanding the business and showing the business how technology will add value to the business and once they get that, they are fully on board.”

Developments
Arslan says one key technology that got his leadership excited is the prospect of mobile banking. At the moment this is a limited offering restricted to SMS but plans are in the pipeline for an interactive mobile channel to be launched by the end of the year. “We are looking at allowing customers to interact with us as they would do sitting in front of their computer or by visiting a branch. It’s a powerful channel that brings the bank to your pocket while allowing us to tap into different market segments – a much younger market segment across the board.” As you would expect, SABB offer online banking too as it looks to expand its channels for customers. The way we bank is changing, Arslan remarks. “It is no longer the case that customers wait for the branch to open at nine o’clock and have to transact between opening hours,” he notes. “They will use an ATM, go on the internet, or use a call centre or bank through their mobile phones.”

Although mobile banking is a channel that Arslan is excited about deploying, he has to contend with the fact that the global recession is beginning to hit the Gulf. Companies are laying off staff and budgets are being slashed. However, this CIO says he is not being asked to cut IT budgets, but rather “do more with less”. “We are trying to keep costs flat because IT is the largest spend for most organisations, especially within banking because we are heavily automated and dependent upon technology.” SABB’s IT spend is up 10 percent on last year but this is being ploughed into new technologies. “Right now the rule of thumb is that we either reduce costs by the investment we have made or you bring in double the revenue over a period of time.” He continues: “It is being measured as what is the positive impact technology can have, either through reducing costs or increasing revenue and bringing in new business. We need to be really focusing on investing in technology in areas that you really believe there will be either a reduction in costs or increased revenues. This will come by providing a better and consistent customer experience.” For Arslan, the right technology is a sound investment.
“We see investment in the right technology as our strategy for future market growth,” he concludes.